In spite of these differences, there are also some similarities which are a good starting point for your business, especially if you are uncertain if you are truly making the most of your network marketing business with respect to building, maintaining, and deepening relationships with your customers.

* Perhaps the most important aspect that will help you to get a good idea as to how to treat your customers and manage the relationships they have with you will have to date back to the point of first contact. When, where, and why did the customer – or potential customer – contact you in the first place?

* What made your product or network marketing business attractive enough to the individual to send you an email or call you? Find out what the words and phrases were that you used and the idea you were trying to get through, and in so doing you will discovery which need of your customer you addressed on that day.

* Once you have identified the need that the customer believed your product or network marketing business could fulfill, it is essential that you become familiar with your customer’s time schedule. For example, if staying home with the kids during the summer vacation is of importance to the consumer, and you know that you have three months left until the first day of summer vacation, you will have just formulated your actual window of opportunity for closing the deal and introducing another candidate to your down line! Work with the time frame provided and help your customer understand how she or he can put this time frame to work in order to achieve their stated goal!

* Do not be bashful but ask! While this may sound like the proverbial car salesman question of “what’s it going to take for you to buy this car today,” this kind of question is not without merit, and while it is advisable to stay away as far as possible from sales related clichés, there are times when they do come in handy. Find out which objections, if any, the customer has, what constraints them, what concerns them, and what is that little push that you could provide in order to make the customer close the deal.

A successful network marketing business relies on customer relationship management more heavily than is often given it credit for and while the hunt for lead will almost certainly continue to take over the lions’ share of the average network marketer’s attention, while it is the relationship savvy marketer who will become successful.

While strategic relationships seem increasingly attractive, there are problems. Nothing is an automatic success. There are many factors working against the formation of strong bonds between companies. Perhaps the biggest source of problems between partners is poor communication. Oftentimes things do not get done because each partner believes the other is responsible. When entering into a new relationship, all companies involved need to be explicit about their objectives and expectations. The companies must agree on all details: What is to be done, by whom, and when.

Management responsibilities and financial policies should be clearly stated. In some cases, companies define their markets and goals so differently they always will be in conflict. These types of philosophical differences should be aired and resolved before any agreement is reached.

Antitrust also can be a problem. In light of the economic challenge from Japan and other international competitors, the U.S. government is allowing companies a greater degree of flexibility in structuring alliances. The government has raised no objection to the Microelectronics and Computer Technology Corporation, an alliance of a dozen computer and electronics companies that was formed to share research costs. But other relationships are sure to raise objections. The intent of the partners is the critical factor. Relationships structured to restrict competition are, and should be, unacceptable.

Another problem is that small companies can become overly dependent upon their larger partners. This is similar to the problem faced by military contractors, many of which survive at the whims of the Pentagon. Companies that depend on a single relationship as a primary source of business can end up in big trouble.

MiniScribe, a tiny Colorado company that supplies disk drives to IBM, saw its stock plummet by more than one-third when IBM changed its buying patterns. The situation can be even worse when a large company decides to vertically integrate, developing its own production capabilities for parts that it once bought from outside partners. Small companies must remain aware of where they stand in their partner’s plans, and should never get in a position where their very survival depends on the continuation of the relationship.

Of course, simply establishing the new relationships is not enough. Companies also must know how to capitalize on the links after they are formed. ZyMos is one company that has failed to do that. As a small company manufacturing custommade semiconductor chips, ZyMos needs to convince customers of its reliability. The marketplace is fearful of a small company in today’s environment. All companies are growing so quickly that they need a reliable supplier.

They can’t afford to have their lines shut down.

Strategic relationships are an ideal way to ease these customer fears, and ZyMos has an impressive list of partners. It has technological agreements with many top-notch companies, including Intel and Apple. But ZyMos is still going out and presenting its product on the basis of technical data. ZyMos’s managers came to us and talked for an hour about line widths. That makes no sense. Pitching technology doesn’t work in this environment. ZyMos should be stressing its relationships with Intel and Apple. They have the right relationships, but they’re not using them.

The idea of strategic relationships is not limited to the electronics and computer businesses. It applies to all fast-changing industries. Strategic alliances can be critical in the biotechnology industry. As in the electronics industry, most of the innovation in the biotechnology industry comes from small firms. But bringing products to market is particularly difficult for small companies in biotechnology. Many biotechnology products must gain government regulatory approval. That is a long and expensive process. Few small companies have the resources to wait out the entire process. Teaming up with large companies solves this problem, while also giving the startups much-needed marketing muscle and credibility.

–

* See the first posting about this at:
The important of Strategic Relationships

—

Indeed, acquisition strategies in technology-based industries have a pretty dismal record. Schlumberger, for example, tried to acquire its way into high technology. The company, a leader in the oil-services business, wanted to gain a foothold in new technologies, so it acquired Fairchild Semiconductor, the pioneer of Silicon Valley’s semiconductor industry. But the strategy backfired. Key employees left the company and Schlumberger’s corporate culture did not translate well to Silicon Valley. Schlumberger’s desired foothold has turned into nothing more than a toehold, if that.

Exxon Corporation’s effort to enter the office-automation market through acquisition of small high-technology companies turned into a disaster.

Western Electric acquired robot maker Unimation in 1982, then saw Unimation’s sales drop sharply. And AM International’s high-technology acquisitions drove it into bankruptcy in 1982.

Clearly, acquisitions are filled with pitfalls. In many cases, large companies would be wiser to buy minority interests in small companies, or sign development contracts with them. These approaches allow the small companies to maintain their culture and entrepreneurial zeal. To better understand the growing need for strategic relationships, it is important to understand the product-development cycle in technology-based businesses. There are many steps between the scientist’s workbench and the assembly line, and no company can handle all steps.

Strategic relationships are needed to bridge the gaps.

*the end.

In fast-changing industries, these relationships are becoming more important than ever before. As technologies advance and become intertwined with one another, no single company has the full range of skills and expertise needed to bring products to market in a timely and cost-effective way. To produce a personal computer, for instance, a company needs expertise in semiconductor technology, display technology, disk-drive technology, networking technology, keyboard technology, and several others. No company can keep pace in all of these areas by itself.

As a result, collaborative efforts are proliferating. Fast-growing companies, once fiercely independent, are now forming all sorts of alliances, even with former competitors. Every small company, it seems, is looking for “sponsors,” while large companies are trying to link up with as many innovative startups as they can. As Business Week magazine wrote in a 1984 special report on the computer industry: “For companies large and small, collaboration is the key to survival.” These collaborations can take many forms: joint ventures, technology exchanges, manufacturing agreements, and equity positions, among others. Although some of the agreements seem aimed at R & D or fi¬nance, these relationships can play a critical role in a company’s marketing strategy.

Companies in fast-changing industries need to form strategic relationships for a variety of reasons:
-    To compete in today’s markets, companies need a diverse set of technologies. Fields like computers and communications are merging, and customers want complete solutions. No company can develop all of the necessary technologies by itself.
-   The costs of developing new technologies are rising rapidly. Companies must share the costs if they are to survive.
-    U.S. companies are facing increasing competition from Japan. The Japanese government has led and helped finance cooperative development efforts in fields such as integrated circuits and robotics. U.S. companies must team up to keep pace.
-    Technologies are changing more quickly than ever before. At one time, a company could stay at the forefront of many different technologies. Now it is much more difficult.
-    Small companies need to gain management expertise, distribution muscle, and capital in order to compete. Strategic relationships can provide these.
-    Less tangible, but just as important, strategic relationships can bring added credibility to the companies involved. By choosing the right strategic partner, a company can gain credibility by association.

–

Next posting for Forming Strategic Relationships in:
> Forming Strategic Relationships -2
> Forming Strategic Relationships -3